Gome unit charged with bribery
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| Gome Electrical Appliances Holding Ltd yesterday said its Chinese mainland unit was charged with bribery at a Beijing court. [CFP] |
![Gome Electrical Appliances Holding Ltd yesterday said its Chinese mainland unit was charged with bribery at a Beijing court. [CFP]](http://images.china.cn/attachement/jpg/site1007/20100302/001fd04cea510cf6c4be01.jpg "Gome Electrical Appliances Holding Ltd yesterday said its Chinese mainland unit was charged with bribery at a Beijing court. [CFP]")
Gome Electrical Appliances Holding Ltd yesterday said its Chinese mainland unit was charged with bribery at a Beijing court, but it dismissed fears that this allegation would have "substantive adverse effect" on its business.
Its unit, Gome Appliance Co, on Thursday received a copy of the indictment regarding the bribery it allegedly committed, Hong Kong-listed Gome said in a statement yesterday.
The offense was said to have occurred from 2006 to 2008 when Huang Guangyu was Gome's chairman and the legal representative of the mainland subsidiary. The unit was one of the parties alleged to be involved in the bribery involving 4.56 million yuan (US$668,034), Gome said.
"The company will actively defend against the accusation at the subsidiary," Gome said.
After consulting its attorney, Gome said that even under the "worst case scenario" of the unit being found guilty, it would only be subject to a fine that will "not have any substantive adverse effect on the operations and the financial conditions" of Gome.
According to Gome, this is the first time it has received a written legal document from Chinese judicial authorities in relation to Huang's case.
Guotai Jun'an (Hong Kong) analyst Julie Ke said this could clear uncertainties about the company's involvement in the suspected bribe.
Huang, who founded the electronics retailer giant and was once the richest man on China's mainland, was formally indicted on charges of insider trading, illegal business dealings and bribery before the Spring Festival, about 15 months after his detention in November 2008.
Although the first two charges against Huang are in his individual capacity, any penalty issued should still impact investor confidence and increase pressure on the stock price in the short term, Ke wrote in a report.
Despite his indictment, Huang is still the biggest shareholder in Gome as he retains a major stake.
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